A business minefield – Employees misusing social media!

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Business owners beware! Even if you or your businesses are not active in the social media space, your employees’ online actions can have a lasting real life impact.

In a well-known case from 2011, an employee of Linfox Australia Pty Ltd was dismissed for posting offensive and discriminatory comments about two of his managers on his Facebook profile page.

The Fair Work Commissioner recognised that the posted comments were ‘outrageous and distasteful’, but found that Linfox did not have grounds to dismiss the employee. At the time of the dismissal and the hearing, Linfox did not have a social media policy.

In the recent case of Malcolm Pearson v Linfox Australia Pty Ltd [2014], the Fair Work Commission held that it is not “harsh, unjust, or unreasonable” to expect an employee to comply with a social media policy that operates outside, as well as inside, the workplace. In this case, Linfox (presumably having learned from its previous experience) had implemented a social media policy and Mr Pearson’s refusal to sign this policy, amongst other shortcomings, constituted a valid reason for dismissal. The Commission dismissed the unfair dismissal case on the basis that the social media policy was a legitimate exercise by Linfox in protecting its reputation and security. The Commission recognised that the natural overlap between public and private life makes such an “invasive” policy necessary.

“It is difficult to see how a social media policy designed to protect an employer’s reputation and the security of the business could operate in an ‘at work’ context only…Gone is the time where an employee might claim posts on social media are intended to be for private consumption only.”

These decisions form part of an evolving body of case law that reflects the increasing prevalence of social media and a more sophisticated understanding of its implications in the workplace.

So what should employers do to protect their interests? Most experts agree that employers should:

  • Implement a comprehensive social media policy
  • Adequately train their employees in the policy and ensure they are aware of the employer’s expectations around social media in and out of the workplace, and
  • Regularly review the policy to maintain currency.

Employers should be mindful that courts and tribunals are increasingly willing to hold employees accountable for social media misuse. Hence, employers should not shy away from robust disciplinary actions when the circumstances are appropriate.

 

Letter of Authority or Letter of Appointment…which one for what purpose?

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As the dust settles on another financial year it is worth looking at some issues that continue to have an element of confusion for all concerned. One of these is the role of an insurance broker in relation to two widely used industry documents – the letter of appointment and the letter of authority.

The purpose of each is for a consumer to approach another broker to act on their behalf. One form, the letter of authority, is an instruction to make enquiries, while the other, the letter of appointment, is a transfer of business from one brokerage to another. These documents are often confused. Use the wrong one and clients may be under the impression that they are merely seeking an alternative quote, only to find they have transferred their portfolio of business to another broker.

The Letter of Authority is a document that may be used in the following examples: the consumer is looking to get an alternative quote via another broker; or if they would like a broker to make enquiries on their behalf, a situation that may occur during a difficult claim. Its purpose is that the instruction from the client is clear and transparent with all parties. This is important to protect privacy and avoid misrepresentation. The document must be signed by the business owner or appointed authority to do so. At this early stage of a possible new broker/client relationship, the broker is not allowed to receive commissions or fees for their services.

The Letter of Appointment is a document that has a clear intent for another brokerage to take over existing business. It would include claims maintenance and credit control. This document authorises the broker to accept commissions and fees for service within the standards set by AFSL licensing requirements.

Both documents have clear, separate intentions but can cause a great deal of confusion if not used correctly. Please contact your broker for guidance in selecting the appropriate document to suit your needs.